The Department of Administration announced that the government will continue to self-insure in fiscal 2025, which begins Oct. 1 and runs through Sept. 30, 2025. Also being continued are the contracts — SelectCare will administer medical and pharmacy benefits while NetCare administers dental benefits.
According to the DOA press release, the providers were selected based on the most economical and beneficial plan, offering the lowest estimated total costs. Under the self-funded plan, GovGuam pays provider claims as they are incurred so the third party administrators, namely SelectCare and NetCare, do not build-in risk factors into the rates. This then allows GovGuam to tailor the plan to fit its needs, according to the press release. GovGuam only pays the providers the fees to adjudicate the claims.
The government of Guam insurance pool includes thousands of active and retired employees, and their dependents.
This will be the second year GovGuam will offer a self-funded medical plan and the fifth year for self-funded dental. The self-funded plan will ensure that funds remain in the GovGuam account and be used to pay claims. Any balance will be retained in GovGuam self-funded account.
Self insurance is a growing trend as reported by the Journal’s sister magazine, Guam Business Magazine. Gov. Lourdes A. Leon Guerrero, while working to secure passage of legislation that would allow GovGuam to self-insure, said an actuarial report for traditional insurance premiums showed increases by as much as 15%. However, by self-insuring the health insurance coverage, employee and retiree premiums for those who had SelectCare at the time would see a decreased cost, and premiums for those who had TakeCare would see an increase by 5% to 8% compared to 15%.
Edward Birn, director, Department of Administration told Guam Business earlier this year that the estimated cost for the fiscal 2024 self-insured health plan was between $110 and $120 million, which would be a projected savings in the range of $5 million to $14 million. Read the GBM article at: guambusinessmagazine.com/insurance-industry-sees-notable-changes
The SelectCare plan offers telehealth access through Teledoc, allowing members to access virtual medical care 24/7.
"Our ability to self-fund healthcare claims today is a powerful indicator of just how far we’ve come from the fiscal challenges we once faced. This achievement is not just about managing healthcare costs. It’s about fulfilling our promise to restore and strengthen our financial foundation. By keeping these funds within GovGuam, we’re not only paying claims but also reinvesting in the health and future of our people—a testament to our commitment to fiscal responsibility and the well-being of our community,” said Acting Governor Joshua F. Tenorio. “This program also shows our commitment to slowing the rate of healthcare inflation for our employees while delivering on the promises we made to our people. We have shown that GovGuam has the capacity to implement a self-funded plan that not only ensures seamless and stable coverage but also generates real savings. To those who doubted our ability to manage this transition, our success stands as proof that we can innovate in a way that benefits both our employees and our community, all while maintaining the high standard of care they deserve." mbj